Giving house to step-daughter?

But it is your money and a teacher's salary won't increase and nor will health bills be paid for sick kids or anyone else, but if you support a specific charity, local hospice, animal rescue etc this amount would make a massive difference. If I have a few pounds spare I have a selection of animal rescue charities I give to.

£40K is a fantastic amount to put into a trust fund for your grandchild and would go a long way to pay uni bills etc when the time comes. Or even a world cruise for you and your husband while you are young and fit enough to enjoy it, but spend it wisely and don't let someone else waste it on your behalf.

You have paid and continue to pay plenty of tax on your salaries and other income. You would have paid tax on your earnings when you were paying the mortgage on the house, you will be paying council tax on it now and tax on the income you get from renting it out. How many more taxes do you want to pay on one house?

If you knew that any more would be spent sensibly by the Govt. then fair enough, but they chuck tax-payers' money around like its going out of fashion. Not a day goes by when some MP or minister isn't being reported for dodgy expenses claims, tax evasion/avoidance or giving their mates lucrative Govt. contracts. How many millions were squandered during COVID? They are using taxpayers' money to pay compensation to the SPM in the Post Office Horizon scandal. That money should be paid by Fujitsu who caused it, but the Govt is just giving them more contracts!!!!!!!!!! God knows how many more similar scandals are brewing.

It depends whereabouts in London they want to buy - it's that old "location, location, location" thing.

I mentioned in another comment about some areas like Hendon or Edgware to the north. Getting the tube from these places into central London is about 30 minutes.

Some examples of houses:

Four bed semi-detached with nice garden near Oakwood Park for £900k

https://www.rightmove.co.uk/properties/137077151#/?channel=RES_BUY

Four bed terrace with nice garden in Wanstead for £900k

https://www.rightmove.co.uk/properties/148823129#/?channel=RES_BUY

Five bed semi with 100 ft garden in Hendon also £900k, needs some updating

https://www.rightmove.co.uk/properties/149392364#/?channel=RES_BUY

These are just three picked totally at random in two minutes on Rightmove, there are many more.

Those who are saying that you need a lot more are likely talking about the more prestigious areas of London.

If your parents think you have given the money to SD they may adjust their inheritance in favour of your niece and nephew (assuming you outlive your parents the DN will receive this sooner).

I think what I would do is tell your parents you have taken financial advice to sell and invest the money. Gift your SD whatever you like and no need to mention anything to your parents

Well OP it depends on what their definition of things like 'good school' is , and things they're willing to compromise on, like distance.

Good school - filled with other ambitious parents, lots of activities, etc? Or just providing the basics like a calm learning environment which in 2024 UK sadly isn't common? I mean you're a teacher so you know what I'm talking about.

A lot of 'high-achieving' parents can't afford private school in 2024 but they can buy up houses in areas around excellent schools making it somewhat private by stealth. Of course houses here will be much more expensive let alone one of the size you desire.

And then, distance. The couple are in the office 3 days a week. They can't move very far to get much cheaper housing unlike people who are in 2 days/once every 2 weeks/fully remote.

You don't need to listen to MN in this though
Surely your SD and her husband have a budget in mind?

If they cannot get what they want they'll just have to adjust their expectations.

I mean off topic now as its a lovely thing the OP wants to do. But your point about investing £150k into someone's life through a second wage and nice clothes/holidays/food on the table or whatever else, definitely does not equal £150k cash in the bank. My kids have cost me a fortune over the years if I worked it out, but its not £150k cash in their bank, certainly not while I'm still living anyway. But it's probably £150k and way more on things I've bought, places we have gone etc etc. You can't turn those things into a house deposit though.

Entirely depends where they want to live and how much they have.

"In my area that’s £2 million plus."

But in other areas of London it certainly isn't. For example, a 4 bed detached in Wandsworth for £900k

https://www.rightmove.co.uk/properties/147779285#/?channel=RES_BUY

or a 5 bed semi with a 100 ft garden in Hendon also for £900k:

https://www.rightmove.co.uk/properties/149392364#/?channel=RES_BUY

I wouldn't voluntarily give any money I didn't have to to any government. On recent form they would just piss it up the wall or embezzle it in fictional "expenses" paying speeding fines etc. If £40K doesn't matter to you, take sound financial advice and give this money to good causes.

There is no tax on gifts in the UK. The only concern would be possible inheritance tax considerations for the OP's estate if she dies within seven years of giving the gift.

No one on this thread except you knows enough about their situation to say. And whatever it is, your contribution would be a huge help to them. If you want to do it, you should talk to them about it.

There is no law that inheritance must go to blood relations! Would your parents have said the same if you had adopted a child? If you had formally adopted your stepdaughter? You love her as your own child, and I think you should do what you choose with your property. And since you are in a position to do it now, when it will benefit her most, do it!

Most people don't get £150k in cash in one go, but most people have 2 parents growing up which means either a second wage coming in, CMS payments, or a SAHP, all of which amount to something approaching £150k being invested.

Apparently parents are now contributing an average of £15kpa to children's expenses at Uni so that alone is £45k.

Remember you need to factor in capital gains tax on the profit made since purchase price when selling your house so that might bring the whole amount available quite a bit lower - not sure if you were thinking of just giving your DSD the profit made on the house or the whole amount when it is sold?

It sounds like she is very important to you & it's so nice that you can support her this way if you decide to go ahead.

I live in the kind of area you're talking about, in zone 3, and a four-bedroom with a large garden like you're describing is about £1.75 million. I'm sure it's doable for much less though. Good luck, I hope you find a way through that works.

OP this is one of the nicest posts I have read. I wish my DH's SM cared about him and his siblings even a fraction of what you clearly do. Everyone wants the best for their children and it seems like you want the same for your DGC. If you are in a position to help them out, I think that is so kind of you. I hope I can do the same in the future for my child.

It’s yours to do with as you please. That’s selfish from your parents about your SD not being a blood relative as she is your family. Why not give her money for a deposit and keep the rest yourself. You could end up helping her further if you wish to, or you might need the money for a rainy day.

Could you give her half and neice and nephew a quarter each?

By all means leave it to her in your will if you want, but I wouldn't give away that money now. Yes, she may need, but so might you. With the way the care system is going, you may well need the money for care when you are older.

OP what a nice way to think - genuinely.

What if your niece and nephew also decide to live in a completely unaffordable city and have a child that they (as any parent would) want to have living in a million pound pad?

Would you want to help them out also?

Can I suggest an alternative - why not give all the rental income to your step daughter and leave the residual to the niece and nephew on death? It will help the step daughter save a lot faster and get her where she needs to be quicker and leaves something for the N&N for their future too.

You are generous, Op.
It's a great idea.

What a lovely step-parent/child story OP, I think you should go ahead - it's your business - and that way you can enjoy the fruits of your very generous gift, including as Granny when you stay there to look after your grandchild.

It's not your parents' business.

You do NOT have to explain why you have no biological children or justify yourself

Your money, your decision.

Just make sure your SD protects it via a deed of trust incase she gets divorced.